The University
budget is separated into two parts--the adjusted or permanent budget and the
operating budget. The adjusted or permanent budget is the approved
annualized plan of financial operations for the University, used primarily for
budget planning. It is the budget approved by The Regents for the fiscal year
and is subsequently adjusted only to reflect changes which have a continuing or
permanent impact on budget planning in the form of annualized modifications. It
provides the basis for the July 1 appropriation entries, as reflected in the
departments' Operating Ledger departmental accounts. The adjusted or permanent
Budget File is maintained in the corporate Information Systems, as well as
local campus systems.

The operating
budget is the financial plan of operations for the current fiscal year as shown
in the Operating Ledger and reflects those budgetary decisions which have an
impact for the current year. The operating budget consists of July
appropriation entries (adjusted budget entries) plus unexpended balances
carried forward from the prior year (re-appropriations); for the General Funded
activities, these balances represent only liens or encumbrances.

The permanent
budget and the operating budget (excluding re-appropriations) are synonymous at
July 1 only. After July 1, modifications based on budgetary decisions will
affect either the adjusted or the operating budget, and the two become dissimilar
from that point until the ensuing July 1.

Budget
modifications are transfers of funds which change the annually approved budget.
A Transfer of Funds is a redistribution of resources (i.e., dollars
and/or full time equivalent, FTE, positions) among budgets or accounts. Transfers
of funds may be temporary (operating budget) or permanent (adjusted or
permanent budget) in nature. A temporary Transfer of Funds effects a
budget change only for the current year and does not affect the permanent
budget. A permanent Transfer of Funds effects a change to the permanent
budget file and involves a commitment beyond the current operating year.

Policy governing
permanent transfers of funds (see Section VI.) is equally applicable to
transfers effected during the course of the fiscal year and to permanent
changes to departmental budgets resulting from incremental allocations made at
the time of transition from one fiscal year to the next.

The policies and
procedures discussed herein apply only to the University budget as described
above, not to various extramural funds (contracts, gifts and grants--see PPM 380-5.

a. Current This refers
to the document number for the current-year portion of this transfer. Budget
Operations, Planning & Analysis is responsible for assigning this number,
so this block must be left blank.

b. Permanent This refers to
the document number for the permanent portion of this transfer. Budget
Operations, Planning & Analysis is responsible for assigning this number,
so this block must also be left blank.

c. Journal Type This field
represents the code designation for a Transfer of Funds. The value for
this field will always be B014.

d. Period The code
designation for the month in which the transfer will be processed.

01 July

02 August

03 September

04 October

05 November

06 December

07 January

08 February

09 March

10 April

11 May

12 June

13 Closing
Period

If
you are unsure as to the period, leave it blank. It will be completed by Budget
Operations, Planning & Analysis or General Accounting.

e. Date This is the
date of the last day in the month in which the transfer is expected to be
processed.

2. Entry Lines

a. Name These three
lines should be used to provide a brief description of the Fund, Organization,
and Program for this line of the entry. This is required for both current-year
and permanent entries.

b. Index This is the
seven-character code that represents a Fund/Organization/Program combination. Although
this represents three other codes, the Index, as well as the Fund,
Organization, and Program are required on the Transfer of Fundsform.
This is required for all entries.

c. Fund The
six-character Fund code represented by the Index is required for all
transactions.

d. Organization The
six-character Organization code represented by the Index is needed for both
current-year and permanent transactions.

e. Account These six
characters represent the budget pool impacted by the transaction. This code
should start with a "5" for budgeting revenue or be one of the
following for budgeting expenditures. This code is required on all entries.

600000 Academic
Salaries

610000 Staff
Salaries

620000 General
Assistance

630000 Supplies
& Expense

640000 Equipment

650000 Travel

660000 Employee
Benefits

680000 Unallocated

690000 Recharges

f. Program The
six-character Program code represented by the Index is required for all
transactions.

g. Activity There are no
plans to use this code at implementation of the new financial system.

h. Location This code is
only used for construction projects, to designate a specific capital asset. For
all other transactions, this field should be left blank.

i. Description This should be
a short depiction of the transaction, such as 'TO ABC1234' or 'FROM Account
610000'. This field must be completed.

j. Debit This is the
debit side of the current-year entry. This figure should include cents.

k. Credit This is the
credit side of the current-year entry. This figure should include cents.

l. +/- This
field represents the entry line in terms of the change to the normal balance of
the account. In general, if the purpose of the line on the transfer is to
increase the budget balance, normally a credit entry for expenditure accounts
and a debit entry for revenue accounts, this field should contain a
"+".

If the
purpose of the line is to decrease a budget balance, normally a debit entry for
expenditure accounts and a credit entry for revenue accounts, this should be a
"-". The exception to this rule is account 690000, the budget balance
for Recharges, which should be increased with a "-", and decreased
with a "+".

Permanent The remainder
of the entry line section pertains to the permanent portion of the entry. These
areas and their titles are shaded on the form.

m. SAU This will be
completed by Budget Operations, Planning & Analysis.

n. SC Stands for
sub-campus and will be completed by Budget Operations, Planning & Analysis.

o. CL Represents
the class of the permanent transaction. This will be completed by Budget
Operations, Planning & Analysis.

p. Type This is a
further classification of a permanent budget transaction and will also be
entered by Budget Operations, Planning & Analysis.

q. FTE DR A debit
adjustment to the amount of FTE permanently budgeted will be placed in this
field. This field can be used in conjunction with accounts 600000, 610000, and
620000.

r. FTE CR A credit
adjustment to the amount of FTE permanently budgeted will be placed in this
field. This field can be used in conjunction with accounts 600000, 610000, and
620000.

s. Debit This lower
debit field is the debit amount of a permanent entry.

t. Credit This lower
credit field is the credit amount of a permanent entry.

3. Footer Information

a. Total Current The total of
the current-year debits should be entered into the left block. The total of the
current-year credits should be entered into the right block. Total debits must
equal total credits.

b. Current This is sum
total of the current-year credits plus the

Document current-year
debits. Simply add the values in the two

Total Total
Current fields. Example:

Total
Current Debits = $200

Total
Current Credits = $200

Current
Document Total = $400

c. Total The total
of the permanent debits should be entered into

Permanent the left block.
The total of the permanent credits should be entered into the right block. Total
debits must equal total credits.

d. Prepared By This field is
required and should contain the name of the person who initiated the transfer.

e. Extension This
required field should contain the extension of the person in the "Prepared
By" field.

f. Explanation See PPM 380-1,A
VII 2

g. Page _ of _ Multiple page
transfers are acceptable but must not exceed 5 pages in length.

4. Completed
Transfers, with the appropriate signatures, should be sent to Budget
Operations, Planning & Analysis, mail code 0936. Retain the goldenrod
copy. After the transfer is processed, a copy, including the document number,
will be sent back to the preparer. Budget Operations, Planning & Analysis
will not send out any additional copies; this is the responsibility of the
preparer.

5. The
following policy guidelines apply to all budget amendments. Before
modifications to the University budget can be approved, the following
conditions must be met:

a. There must be full and
adequate justification supporting proposed changes as follows:

(1) There must be
detailed explanation why the proposed change is to be made.

(2) There must be full
detail of the change including programs, accounts, FTE, funding and similar pertinent
data.

(3) The effective date
of the proposed change and the fiscal year applicable must be indicated.

(4) All changes
requiring Office of the President approval must cite current policy or an
official University directive which supports or authorizes the change.

(5) All required
signatures and approvals must be completed.

b. The adjustment shall not
adversely affect the achievement of the assigned campus budgetary savings
target.

c. Permanent changes must
reflect both dollar and position (FTE) adjustments on an annualized basis.

d. Temporary changes shall not
create a new policy, program, or project involving a commitment beyond the
current year.

The
ultimate authority to amend the budget is with The Regents. Section 101.1.m
(1), (2) of the Standing Orders of The Regents authorizes the President to
approve certain transfers or allocations of University operating funds. The
President has delegated some of this authority to the Vice President-Budget and
University Relations (the Director of Budget has been designated to act in this
capacity) and to the Chancellors.

University
expenditure programs are classified according to appropriation categories. Each
appropriation category defines a recognized University activity, such as
Instruction and Departmental Research, Organized Research, and Libraries, and
groups programs accordingly. The President has designated, within the
organization of expenditure programs, certain control points for the purpose of
budget administration. These control points represent the level of
administrative control immediately below the campus or location level of
organization. The primary purpose of budget control points is to insure that
funds are expended for the purposes for which they were approved and allocated
and to maintain the integrity of the budget as it was represented to The
Regents and to the State. Only the President or his designate may approve
budget amendments which require a Transfer of Funds between budget control
points or between campuses. Transfers of funds between budget accounts within
each control point may be approved by the Chancellors subject to limitations
prescribed by the President. The following control points are designated:

1.Instruction and Departmental Research and Academic Support related to
General Campuses and to Agricultural Sciences (programs 40XXXX and 43XXXX).

2.Instruction and Departmental Research and Academic Support relating to
the Health Sciences (programs 40XXXX and 43XXXX).

Central
provisions for allocation, such as provision for merit increases and special
State appropriations for deferred maintenance, are not restricted to control
points and may be distributed to other functions subject to guidelines
provided. Provisions for allocation must not, however, be augmented from campus
and other sources of funds or by transfers between provisions. Augmentation of
these programs shall be made by an allocation from the Office of the President
provisions.

Temporary
budget amendments, which may adjust income, recharges, or appropriations to
meet circumstances peculiar to the operating year, are effective only for that
year, and may not involve commitments beyond the current operating year. The
authority to make temporary adjustments to the operating budget provides
University Management with the necessary flexibility in budget administration. The
following sections describe temporary budget changes.

Temporary
budget amendments which require Regents' approval must be submitted to the
President through the Director of Budget. The following temporary budget
amendments require approval by The Regents:

1. Transfers
of endowment principal involving the Nuclear Science Fund or the University
Opportunity Fund.

2. Transfers of endowment resources which
are not budgeted.

3. Uses
of University Registration Fee provisions for allocation for capital improvement
projects for initial funding or augmentation.

3. Requests
for allocations from the President's Provision for Contingencies, supported by
a complete description and justification of need, shall be forwarded to the
President through the Director of Budget.

4. Requests
for new income or recharge accounts will be reviewed jointly by the Director of
Budget and the Senior Vice President - Administration and shall be supported by
the following data:

a. The necessity for new
accounts as related to the program objective such as the need for a service or
operation based on user demand or because there is no other available source or
supplier.

b. The basis for funding,
whether general or restricted, and the reason for suggested funding, such as
carry forward of surpluses or reserves and the justifications related.

c. A listing of the sources or
customers on which the recharge and income estimates are based.

d. A
rate scheduled with supporting calculations which has been approved by the
campus Recharge Rate Review Committee.

5. Excess
General Fund income realized above estimate shall not be appropriated unless
authorized by the President. Excess General Fund income shall be appropriated
only for those expenses which are directly related to the production of
incremental income and shall not be appropriated for any other purposes.

6. Increases
or decreases to appropriations of endowment income after the original estimate
of income has been approved by The Regents.

Chancellors
may amend their budgets within established control points specified in Section
IV.C., subject to the following:

1. Budgets
for Academic Salaries and Academic FTE positions may be amended within
established control points except that:

a.Budgeted FTE for Academic Salaries shall be increased only for temporary
positions created from campus funds for sabbatical leave replacement, academic
upgrading funds, and endowment funds.

(1) The total number of
budgeted academic positions for general campuses and the Health Sciences
Instruction and Departmental Research shall be increased only by utilizing
instructional support (accounts 610000, 620000, 630000, 640000, 650000, 660000,
680000, and 690000) to fund Academic Administrator positions (title codes
1000-1099).

(2) Appointments to temporary
positions as defined in C.1.a. shall be made only for the current fiscal year.

b.Transfers of funds from Academic Salaries (account 600000) to Supplies
and Expense (account 630000) may be made only for academic personnel related
costs of honoraria and employee death payments. Transfer may be

made from
Academic Salaries to General Assistance (account 620000) only for temporary
funding of academic personnel.

(1) Transfers from
Academic Salaries for these specific uses is required for reporting purposes.

(2) All temporary
academic appointments, except those with positive time reporting and readers,
shall be handled within the Academic Salaries subaccount.

c. With the exceptions noted in
C.1.a.,b. above, funds transferred from or to Academic Salaries for any other
purposes require written approval of the President. Funds shall not be
transferred out of Academic Salaries for equipment, for non-recurrent purposes,
or to offset deficits in other accounts at any time including fiscal closing except
as provided in Section V., Chapter 4020, Budgetary Savings, PLANNING AND BUDGET
MANUAL.

2. Budgets
for Staff Salaries, General Assistance, Supplies and Expense, Equipment and
Facilities, Special Items, and other unallocated accounts may be amended within
control points, except that:

a. The number of staff positions
(FTE) shall not exceed the number in the adjusted budget, excluding temporary
positions.

b. Temporary positions must be
identified and must terminate at the end of the fiscal year. If temporary
positions are made permanent, they must be included in the permanent budget for
the next fiscal year.

c. Staff salary funds may not be
transferred to other support accounts until attainment of the campus budgetary
savings target is assured.

3. Upward
and downward revisions of budgets of wholly or partially self-supporting
service activities because of increase or decrease in income or recharges,
including FTE for temporary positions, may be approved by the Chancellor.
Changes to budgets for self-supporting activities which are the sole provider
of University-required services, such as campus and intercampus telephone,
central data processing, and garages must be reported to the Director of Budget
and the Senior Vice President - Administration.

4. Campus
provisions for contingencies, if provided from General Funds, shall be used
only to augment operating costs for wholly or partially General Fund supported
organizations in the current year.

5. The
Teaching Hospital budget may be revised when the deviation from the original
estimate is not more than 10 percent, subject to the availability of funds,
provided the revision covers the estimated activity for the entire remaining
portion of the fiscal year.

6. Transfers
of funds from budgeted campus endowment resources may be approved whenever the
individual transfers are in accordance with the terms of the endowment fund.

7. Transfer
of Funds from budgeted campus reserves funds may be approved provided the
transfer is for a purpose for which the reserve fund was established.

8. Transfers
from Registration Fee Fund provisions for allocation may be made to augment
current year operating costs, including costs for merits and promotions and
salary range increases of University Registration Fee funded activities. (See
Section IV.G., Chapter 6030, University Registration Fee, PLANNING AND BUDGET
MANUAL.)

Permanent
budget amendments are changes to the base or adjusted budget which require a
permanent Transfer of Funds to amend the Budget File. Examples of such
amendments include reorganization, new programs, expansion or contraction of
existing programs, and permanent changes in income estimates or structure. Any Transfer
of Funds and positions which effect permanent operational or program
changes must be reflected in the approved annualized, permanent plan of
operations for future planning. Permanent budget amendments which do not
change the total dollar level of the approved University General Fund budget,
except for permanent transfer of activities between locations, may be approved
by the President. Any permanent budget amendment which effects a change above
the approved University General Fund budget and which represents a permanent
transfer of activities between campuses must be approved by The Regents. All
permanent budget amendments must meet the following requirements before
submission to the Director of Budget for processing and approval:

1. All
permanent budget amendments shall reflect both dollar and position (FTE)
adjustments on an annualized basis.

2. All
permanent budget amendments must have the approval of either The Regents, the
President, the Chancellor, or their authorized designates.

3. Intercampus
transfers must be approved by the Chancellors or their designates of both
campuses involved prior to referral to the Director of Budget for approval by
the President.

Permanent
budget adjustments which transfer funds from Staff Salaries to other support
accounts must be in terms of specific FTE and related salaries at the lowest
step of the applicable salary range as shown in the Staff Title and Pay Plan,
PPM/SPM 250-Pay Rates. It is absolutely essential that any merit funds which
have previously accrued to a staff position which is either discontinued or
filled at a lower step remain in the Staff Salaries account to be drawn off
during the staffing reconciliation process according to policy as outlined in
PPM 380-3. Such funds are required to support the cost of 1) continuation of
January 1 staff merits, 2) continuation of six-month increases, and 3) funding
of staff reclassification costs, in that order of priority. (See PPM 380-3,
Budget Administration of Staff Salaries.)

All
adjustments to the annually approved budget which are processed during the course
of a fiscal year shall be prepared on a San Diego Campus

Transfer of Funds form,
FO 2202, Exhibit B. This form is available at the Central Storehouse.
Transfers between campuses must be prepared on an Interlocation Transfer of
Funds, UFIN 15201, Exhibit C. This form can be obtained from Budget
Operations, Planning & Analysis.

a.Temporary Adjustments

If a transfer is intended to
be effective in the current year only, it is a temporary transfer and entries
are required on the current year line of the Request for Transfer of Funds
form.

The transfer number should
not be assigned since this will be completed by Budget Operations, Planning
& Analysis.

b.Permanent Adjustments

If the adjustment is to be
a permanent one that is to extend beyond the current year, it will be necessary
to annualize entries and utilize the permanent line of the Transfer of Fundsform.

In making annualized
entries, the full year cost of the change being made must be considered. For
example, if a position is being established as of September 1, at $1000 per
month, only $10,000 is required in the current year. The annualized entry for
the permanent budget would require the full year's salary of $12,000. Note
that cents are omitted for permanent entries.

2. Justification

All
amendments to the operating and permanent budgets should contain descriptive
information with sufficient justification and operational data to permit
independent analysis and recommendation. This information should be concise and
yet encompass all of the applicable explanatory data as specifically outlined
below and in Section IV.A., including the reason why funds are available as
well as why needed.

a. Proposed
adjustments of income or recharges of wholly or partially self-supporting
service activities should:

(1) Estimate activity
for the entire remaining portion of the fiscal year.

(3) Justify changes to
each account to which the adjusted income or recharge is to apply.

(4) List other
departmental budgets which might be effected by the change of distribution.

b. Both lines of each
transaction should be explained, i.e., why funds are available in one budget
account and why they are needed in the one to which they are to be transferred.
When academic salaries are adjusted, provision numbers of affected provision
must be shown.

c.Adjustments to accounts for salaries or wages which will change the

approved FTE
should be clearly identified as permanent or temporary, and numbers of FTE
involved are to be specified in all cases. Funds may not be transferred from
General Fund salary accounts to other accounts on a current year basis until
attainment of the campus budgetary savings target is assured. (See V.C.2.c.) On
a permanent basis, department administrators may transfer from staff salaries
only in terms of specific FTE and related salary dollars at the lowest step of
the applicable salary range as shown in the Staff Title and Pay Plan, in order
to protect the source of campus funding for continuation cost of January staff
merits, six-month increases, and the cost of staff reclassifications (see
Section VI.B.).

d. Revisions of equipment and
facilities budgets must include a listing of major equipment items which the
transfer might add or delete.

e. In the interest of
continuity, reference should be made by number and approval date to any
previous transfers which may have requested similar adjustments to the same
budget within the current fiscal year.

f. The completed Transfer of Fundsform
shall be signed by the department head or his designated representative. Academic
salary transfers must be signed by an academician.

3. Routing of Transfers of Funds

The
completed Transfer of Funds form shall be routed to Budget Operations,
Planning & Analysis as shown in Exhibit A. The form should be intact except
for the last copy which is retained by the originating department.

Policies
and procedures governing permanent Transfer of Funds processed during a
fiscal year are equally applicable to the transition period from one fiscal
year to the next. (See Section VI and Section VII.A.)

Each
department head shall prepare such Transfer of Fundsforms
as are required to implement the operation of his/her organization in the most
effective manner possible within the limits of the budget appropriated and of
University policy and procedures as described above.

Each
reviewer and reviewing office shall take such action with regard to approval of
transfers submitted to them as is deemed necessary, in as timely a manner as
possible. After approval, the Transfer of Funds shall be sent to the
next routing station. If disapproved, it shall be returned to the originator
with explanation. If a Transfer of Funds number has been assigned by Budget
Operations, Planning & Analysis, the originator shall notify Budget
Operations, Planning & Analysis to void the number.

Upon receipt of a Transfer of Funds,
Budget Operations, Planning & Analysis shall:

1. Assign
a Transfer of Funds number and enter the transfer on the official log of
Transfers of Funds.

2. Verify
that all prior approvals required are indicated by signatures on the Transfer
of Funds.

3. Route
the Transfer of Funds to any other administrative office for further
approval if required by local or the Office of the President policy.

4. Process approved permanent transfers
into the Budget System.

5. Forward
temporary transfers for review and processing to the General Accounting Office.

6. Return
a copy of the approved and processed Transfer of Funds to the
originator; forward a post audit copy of each processed Transfer of Funds
to the Office of the President-Resource Administration.